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Farmer v. Fed. Nat'l Mortg. Ass'n

COMMONWEALTH OF MASSACHUSETTS APPEALS COURT
May 15, 2015
14-P-394 (Mass. App. Ct. May. 15, 2015)

Opinion

14-P-394

05-15-2015

DENNIS FARMER v. FEDERAL NATIONAL MORTGAGE ASSOCIATION & others.


NOTICE: Summary decisions issued by the Appeals Court pursuant to its rule 1:28, as amended by 73 Mass. App. Ct. 1001 (2009), are primarily directed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, such decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28 issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260 n.4 (2008).

MEMORANDUM AND ORDER PURSUANT TO RULE 1:28

This is one of a number of legal actions arising from Dennis Farmer's default on his mortgage obligations. The central issue in this appeal is whether Farmer holds superior title in his current residence over Federal National Mortgage Association (Fannie Mae). The bank defendants appeal from (1) the May 2, 2013, orders by a Superior Court judge allowing Farmer's motion for partial summary judgment on count VI (action to quiet or to establish title to land) and count VII (declaratory judgment), and denying the defendants' motions to dismiss; (2) the "judgment" on counts VI and VII entered on August 19, 2013; (3) the judge's "implicit" determination that a separate and final judgment should enter pursuant to Mass.R.Civ.P. 54(b), 365 Mass. 820 (1974); and (4) the denial of their motion to alter or amend the judgment seeking a clarification that the judgment did not apply to BAC Home Loans Servicing, LP (BAC), and Bank of America, N.A. (BANA) (collectively Bank of America defendants).

The confusing procedural course unduly complicated the legal issues in this case. In a series of three hearings conducted between February 28 and March 14, 2013, the motion judge considered together (1) the two separate motions to dismiss of the three original defendants; (2) Farmer's motion to amend the complaint seeking to add BAC and BANA as defendants; and (3) Farmer's motion for partial summary judgment on counts III, VI, and VII of the original complaint. At the second hearing, the judge allowed the motion to amend, making the amended complaint the operative document for purposes of her rulings. In her written decision, the judge partially converted the motions to dismiss into motions for summary judgment under Mass.R.Civ.P. 56, 365 Mass. 824 (1974), on the discrete "issues" of res judicata and count III (violation of G. L. c. 93A), but applied the Mass.R.Civ.P. 12(b)(6), 365 Mass. 754 (1974), dismissal standard to counts I, II, and V. As the judge acknowledged, the Bank of America defendants were not parties to the rule 12 and rule 56 motions.

1. Rule 54(b). As an initial matter, there is a serious question whether the appeal is properly before us. Notwithstanding the pendency of several claims, the "judgment" here was erroneously entered on the docket pursuant to Mass.R.Civ.P. 58(a), as amended, 371 Mass. 908 (1977). As a general rule, a grant of partial summary judgment is not appealable until after the disposition of all claims against all parties. See Morrissey v. New England Deaconess Assn.--Abundant Life Communities, Inc., 458 Mass. 580, 594-595 (2010). Although rule 54(b) carves out a narrow exception to our "bedrock policy against premature and piecemeal appeals," Long v. Wickett, 50 Mass. App. Ct. 380, 388 (2000), it is not apparent that the judge intended for the judgment to be final. See Bragdon v. Bradford O. Emerson, Inc., 19 Mass. App. Ct. 420, 421-423 (1985).

Adopting Farmer's proposed form of judgment verbatim, the judge ruled and declared, inter alia, that (1) three documents in the chain of title were void: the assignment of mortgage from Mortgage Electronic Registration Systems, Inc. (MERS), to Countrywide Home Loans, Inc. (Countrywide), recorded on September 18, 2008; the assignment of mortgage from Countrywide to BAC recorded on April 30, 2010; and the mortgage foreclosure deed granted by BANA, as successor by merger to BAC, to Fannie Mae recorded on October 19, 2011; (2) Farmer's interest in the title to the subject property was superior to "each and every one of the defendants in this case;" and (3) the documents recorded by the defendants did not encumber or cloud Farmer's title. The judge ordered the Suffolk County register of deeds to make a note on these documents indicating that they were void and were to be struck from the title records. At the time this judgment entered, the motions to dismiss of the Bank of America defendants had not yet been heard. Farmer's attorney nevertheless treated the judgment as final and recorded it in its entirety in the registry of deeds. Farmer, we are informed, subsequently moved back into the property.

No party sought the entry of a separate and final judgment under Mass.R.Civ.P. 54(b), 365 Mass. 820 (1974). The judge, moreover, did not issue a rule 54(b) certification or make the requisite findings that would justify one.

That said, the disputes over this property have been going on for many years. The integrity of the public recording system is at stake. Because the issues have been fully briefed and argued by the parties, and no useful purpose would be served at this point by requiring additional proceedings below, we exercise our discretion to reach the merits. See Kobico, Inc. v. Pipe, 44 Mass. App. Ct. 103, 104 n.2 (1997); Smith v. Arbella Mut. Ins. Co., 49 Mass. App. Ct. 53, 54 (2000).

2. Counts VI and VII. Farmer's title-based claims were barred by principles of res judicata. In order to succeed on an action to establish or quiet title under G. L. c. 240, § 6, Farmer was required to prove "better title to the locus than the defendants possess . . . ." Bevilacqua v. Rodriguez, 460 Mass. 762, 767-768 n.5 (2011), quoting Sheriff's Meadow Foundation, Inc. v. Bay-Courte Edgartown, Inc., 401 Mass. 267, 269 (1987). In the earlier postforeclosure summary process action, a Housing Court judge decided this precise issue adversely to Farmer. Farmer cannot relitigate the title issue here. See Sheehan Constr. Co. v. Dudley, 299 Mass. 51, 53-54 (1937); TLT Constr. Corp. v. A. Anthony Tappe & Assocs., Inc., 48 Mass. App. Ct. 1, 4-5 (1999).

To the extent that the Superior Court judge ruled that the defendants waived their rights and were judicially estopped from raising the defense of res judicata, those rulings were erroneous on the facts of the case.

Ruling on Fannie Mae's motion for summary judgment, a judge of the Housing Court concluded that BANA, the undisputed mortgage holder at the relevant times, strictly complied with the publication and notice requirements of G. L. c. 244, §§ 14 & 15; the foreclosure deed executed and delivered by BANA to Fannie Mae "conveyed good, clear, and marketable title to the property;" and that Fannie Mae's right to possession, as postforeclosure owner, was superior to any interest held by Farmer. Final judgment of possession in favor of Fannie Mae entered on July 10, 2012. Farmer did not timely appeal from that judgment. Following the denial of postjudgment relief, Fannie Mae levied on the summary process execution, evicting Farmer.

The validity of Fannie Mae's title was essential to the judgment of possession. To prevail on its claim for possession, Fannie Mae, the party with the burden of proof, was required to make a prima facie showing that it had obtained a deed to the property and that the deed and the affidavit of sale (showing that the foreclosure was carried out in strict compliance with statutory requirements) were recorded. See Bank of N.Y. v. Bailey, 460 Mass. 327, 334 (2011). Here, the Housing Court judge concluded that Fannie Mae made the showing, and that no material facts regarding Fannie Mae's right to possession were in dispute.

Although, as Farmer correctly pointed out, the Housing Court is a court of limited jurisdiction, in the context of a summary process action brought against a holdover mortgagor, it had the authority to decide Farmer's validity of title defense. See Bank of N.Y. v. Bailey, 460 Mass. 327, 332-334 (2011) (former homeowner may challenge legal title and require the holder of the title to establish that the acquisition strictly complied with the power of sale in the mortgage); Federal Natl. Mort. Assn. v. Hendricks, 463 Mass. 635, 642 (2012) ("[A] defendant in a postforeclosure summary process action may challenge a plaintiff's title, i.e., its right of possession").

3. Defective foreclosure claims. In this action, Farmer again challenged Fannie Mae's ownership of the subject property, maintaining that the foreclosure was void based upon the seller's noncompliance with a number of statutory mandates. See U.S. Bank Natl. Assn. v. Schumacher, 467 Mass. 421, 432-433 (2014) (any violation of the statutes relating to foreclosure by the exercise of the power of sale, see G. L. c. 183, § 21, and G. L. c. 244, §§ 11-17C, will void the foreclosure sale). Specifically, Farmer focused here upon the jurisdiction and authority of BANA to foreclose, the validity of the assignments, and the alleged noncompliance with the notice and publication requirements of G. L. c. 244, § 14 (§ 14). These alleged defects in the foreclosure process -- complete defenses to eviction -- were or should have been raised in the Housing Court proceeding. See Rule 3 of the Uniform Summary Process Rules (1993) ("[t]he defendant shall also state in the answer any affirmative defense which may be asserted . . . ." [emphasis added]). See also TLT Constr. Corp. v. A. Anthony Tappe & Assocs., Inc., 48 Mass. App. Ct. at 4.

We note that in the course of discovery in the summary process proceeding, Farmer apparently admitted to receiving the notice of sale required by G. L. c. 244, § 14. As noted by the Housing Court judge in his decision, Farmer did not dispute that BANA held the mortgage at the necessary times as required by U.S. Bank Natl. Assn. v. Ibanez, 458 Mass. 637, 646-648 (2011). In the present action, Farmer disputed these facts.

In any event, even if these issues were properly before the Superior Court judge, there was no merit to them. The assignment from MERS, mortgagee solely as nominee for lender and lender's successors and assigns, to Countrywide was valid for the reasons discussed in Shea v. Federal Natl. Mort. Assn., 87 Mass. App. Ct. 901, 902-903 (2015).

To the extent that Farmer now claims no § 14 notice was ever sent, there were letters and return receipts signed by Farmer in the record demonstrating that BANA, through Harmon, sent, by regular and by certified mail, the required notices. Moreover, in an affidavit submitted in this action, Attorney Paolo Farese averred that, as stated in his recorded affidavit of sale, Harmon mailed the notices required by § 14. Farmer failed to place this issue of statutory compliance into legitimate dispute. See Federal Natl. Mort. Assn. v. Hendricks, 463 Mass. at 642-643.

Farmer's two affidavits submitted in support of his motion for partial summary judgment are tellingly silent on the alleged lack of § 14 notice.

Farmer's claim that the § 14 notices were inadequate because the word "mortgagee" does not appear in them was not persuasive; the letters accurately identified BANA, successor by merger to BAC, as the present holder of the mortgage as required by U.S. Bank Natl. Assn. v. Ibanez, 458 Mass. 637, 646-648 (2011).

The Shea case also disposes of Farmer's claim that the § 14 notice was defective because it identified the wrong mortgagee (BANA as opposed to MERS). The documentary evidence established that BANA, successor to BAC by merger, held the mortgage, through a chain of recorded assignments, as of July 25, 2011, and August 19, 2011 (the dates of the notice of sale and the foreclosure sale). Moreover, it was undisputed (and the record established) that BAC merged into BANA as of July 1, 2011.

In light of the statements in Farmer's own amended verified complaint regarding Harmon's placement of advertisements in the Boston Herald and exhibit K attached to the complaint (a copy of the advertisement and the affidavit of sale), Farmer's claim that there was no evidence of publication was particularly frivolous.

4. Violation of G. L. c. 244, § 35A . The judge erred by relying upon the undisputed noncompliance with § 35A as a basis to void the foreclosure and to grant summary judgment to Farmer on his title-based claims. First, the factual record before the motion judge established, as matter of law, that the statute was inapplicable. Second, in contrast to the statutes regulating the foreclosure of mortgages by the exercise of a power of sale, a violation of § 35A did not, as the judge ruled, automatically void the foreclosure sale. See U.S. Bank Natl. Assn. v. Schumacher, 467 Mass. at 431-433; Bank of N.Y. Mellon Corp. v. Wain, 85 Mass. App. Ct. 498, 501 (2014).

Neither complaint even hinted at the assertion of a § 35A claim. So far as appears, the judge raised the issue sua sponte at the second hearing on the motions before her and asked for further briefing and proof of compliance.

Inserted in 2007, § 35A did not apply, as herein relevant, to mortgages whose statutory condition had been voided prior to May 1, 2008, its effective date. See St. 2007, c. 206, §§ 11 & 21. A Superior Court docket entry from a related proceeding filed by Farmer in 2008 established that as of November 18, 2008, Farmer had not made any mortgage payments since February, 2007. See Home Depot v. Kardas, 81 Mass. App. Ct. 27, 28 (2011) (court can take judicial notice of the docket entries of other cases). Cf. G. L. c. 183, §§ 20 & 21; Eaton v. Federal Natl. Mort. Assn., 462 Mass. 569, 585 n.23 (2012). In response to Harmon's submission of this document, Farmer did not set forth specific facts, by reference to appropriate summary judgment materials, showing that there was a genuine issue of fact regarding the date of his default.

In their briefs, the defendants have not addressed the propriety of the denial of their motions to dismiss. Given the lack of substantive argument, this issue is deemed waived. See Auto Flat Car Crushers, Inc. v. Hanover Ins. Co., 469 Mass. 813, 833 n.22 (2014).

5. Conclusion and disposition. The defendants' motions to dismiss, converted to summary judgment motions on the defense of res judicata, should have been allowed on the title-based claims. In other words, partial summary judgment should have been rendered against the moving party, Farmer. See Mass.R.Civ.P. 56(c), as amended, 436 Mass. 1404 (2002); M.P.M. Builders, LLC v. Dwyer, 442 Mass. 87, 89 (2004). The August 19, 2013, judgment predicated on these erroneous rulings cannot stand.

The judge also granted summary judgment in favor of Farmer on count IV (trespass) with respect to Harmon, while denying it with respect to the other defendants. This ruling and order for judgment, however, was not incorporated into the ensuing judgment. Since, as we have concluded, Farmer is precluded from relitigating the title issue herein, his trespass claims against all the defendants arising from the 2011 foreclosure sale failed as matter of law. See Brice Estates, Inc. v. Smith, 76 Mass. App. Ct. 394, 396 n.3 (2010) (an illegal entry by the defendant is an essential element of a trespass claim).

As a matter of logic, the August 19, 2013, judgment could not have applied to the Bank of America defendants, who were not parties to the motions to dismiss and for partial summary judgment. The judge thus erred by denying the defendants' motion to alter or amend the judgment to reconcile the form of the judgment with her May 2, 2013, order for judgment limiting its reach to the original three bank defendants.

The July 10, 2012, Housing Court judgment of possession in favor of Fannie Mae remains in full force and effect. If Farmer refuses to vacate the subject property voluntarily, Fannie Mae may seek the remedy of summary process in the Housing Court based on that judgment.

The Superior Court judgment dated August 19, 2013, is vacated. The case is remanded for further proceedings in the Superior Court consistent with this memorandum and order.

In view of our decision, defendant Harmon may move in Superior Court to vacate so much of the May 9, 2013, order for judgment as concerns count IV.

So ordered.

By the Court (Cypher, Wolohojian & Blake, JJ.),

The panelists are listed in order of seniority.
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Clerk Entered: May 15, 2015.


Summaries of

Farmer v. Fed. Nat'l Mortg. Ass'n

COMMONWEALTH OF MASSACHUSETTS APPEALS COURT
May 15, 2015
14-P-394 (Mass. App. Ct. May. 15, 2015)
Case details for

Farmer v. Fed. Nat'l Mortg. Ass'n

Case Details

Full title:DENNIS FARMER v. FEDERAL NATIONAL MORTGAGE ASSOCIATION & others.

Court:COMMONWEALTH OF MASSACHUSETTS APPEALS COURT

Date published: May 15, 2015

Citations

14-P-394 (Mass. App. Ct. May. 15, 2015)